Australia’s power grid won’t be ready for summer

The Grattan Institute report suggests that Australia's not ready for next summer, and likely won't be.

The summer of 2016-2017 saw blackouts and "load-shedding", or deliberate power cutouts, around Australia and highlighted the need for changes in Australia's power grid, while recent months have likewise been marred by numerous smaller outages and incidents. Now, a report from the Grattan Institute confirms that next summer may pose even more of a problem, especially in Victoria and South Australia.

Last summer, power was deliberately shut off, in order to ensure that supply was able to keep up, despite there technically being enough capacity. Next summer, however, Victoria and South Australia might actually find themselves without adequate capacity, and much more at risk of load-shedding or blackouts.

As such, Australia's energy market is now facing the twin difficulties of ensuring adequate capacity as well as preventing major price spikes, beyond what has already occurred. The Grattan Institute report suggests a large part of the problem lies in "a decade of toxic political debates, mixed messages and policy backflips [that] has prevented the emergence of credible climate change policy", saying that "Investment in electricity generation, including renewables, is stalling as market participants await clear policy signals from government."

The wildly different approaches taken by states individually may also be preventing effective scaling of solutions, and limiting investor confidence in the National Electricity Market (NEM). The report warns that the survival of the NEM cannot be assured, and emphatically calls for a combined approach by government and the market.

The future of Australia's energy supply is intertwined with policy around renewable energy and emissions reduction, but a practical solution is most likely to only emerge from a concerted long-term plan that doesn't change with election cycles. Unsurprisingly, many Australians aren't sure this feasible, and are taking matters more into their own hands. The volume of solar panel installations in March 2017 was about double that of March 2016, largely attributed to blackouts and power disruptions, and the growth of home solar shows no signs of slowing.

If next summer brings the warned-of blackouts and continued price rises, it's likely that far more people, especially in Victoria and South Australia, will move towards home solar and household battery storage as a more reliable way of powering their homes. A lot of energy retailers are anticipating this and now offer full start-to-finish home solar installation alongside electricity and gas plans.

With power problems on the horizon for next summer, it might pay to be prepared. As you compare energy plans, it may be a good idea to look for set-price contracts in order to avoid hikes next summer, as well as to give home solar systems some serious consideration.

Much like your energy bill, the cost of solar panels and installation might also increase when warmer weather rolls around, especially if there's still no viable government response to the ongoing energy crisis, and blackouts forecast for summer.

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